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Kerry appalled by severed head child image

Nick Perry

It's an image so shocking it's disgusted US Secretary of State John Kerry and found its way to the top of the agenda at high-level security talks between Australia and its number one ally.

Mr Kerry has described a "stomach turning" photograph of a seven-year-old Australian boy holding the severed head of a Syrian soldier as proof that homegrown terrorism is a serious threat in need of a global solution.

The growing risk that jihadists fighting in Syria and Iraq will return to their homelands as trained terrorists was a major talking point at the Australia-US Ministerial (AUSMIN) meeting in Sydney on Tuesday.

The defence and foreign ministers of both countries agreed to take the issue to the United Nations next month to seek a global response and warn that Australia's experience was not unique.

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Mr Kerry said the image - allegedly posted online by the boy's father, convicted Australian terrorist Khaled Sharrouf - was "utterly disgraceful" and underscored the level of extremism posed by these radicals.

"That child should be playing with other kids, not holding a severed head and out in the field of combat."

Iraq, which is struggling to take back territory captured by extremists from the Islamic State - formerly known as ISIL or ISIS - also dominated the AUSMIN agenda.

Mr Kerry offered his support to Iraq as it went through a leadership change and thanked Australia for air-dropping much-needed supplies to refugees facing certain death in the north of the country.

But he ruled out putting US boots back on the ground in Iraq, a prospect Foreign Minister Julie Bishop and Defence Minister David Johnston also played down.

"This is a fight that Iraqis need to join on behalf of Iraq," he said.

US Defense Secretary Chuck Hagel suggested the US would consider further requests from Iraq for support, but didn't say if this meant more airstrikes were on the way.

But the Middle East wasn't the only trouble spot under scrutiny.

The visiting US officials offered their condolences to the families of the 38 Australian citizens and residents who lost their lives in MH17, and vowed justice would be served for the "unconscionable crime".

The condemnation of Russia for supporting separatist rebels in eastern Ukraine who are thought to have shot down the plane was unequivocal.

But it was Ms Bishop who personally lashed out at Russia's response since the tragedy, accusing Moscow of ramping up its supply of weapons to the rebels as unarmed Australian and Dutch investigators tried to retrieve evidence from the crash site.

"On the very day that Australia was holding a national day of mourning to grieve the loss of so many Australian lives, Russia chose to impose sanctions on Australia," she added.

In between the pressing global agenda - China's rise, North Korea's nuclear ambitions and the war in Gaza also featured - the US-Australia alliance was given a nod.

The four senior political figures signed a new defence agreement on the future rotation of US marines and aircraft through Darwin.